Chinese regulators have approved a deal for Alibaba’s investment arm to buy 5.26% of Mango Excellent Media for $946 million (RMB6.2 billion), tying together two of the country’s top online video platforms at a time when the battle for local streaming supremacy is ramping up.
Alibaba owns Youku, China’s number three streaming platform, while TV producer Mango Excellent — which has ties to the influential state-run TV network Hunan Broadcasting System — owns the immensely popular Mango TV service. The deal makes Ali Venture Capital the second-largest shareholder in the latter firm, and marks the first major investment by a privately owned tech firm in one of China’s top state-owned online broadcasters, notes the Caixin news outlet.
The cultural assets supervisory body of Hunan province, where Mango Excellent Media is headquartered, this week approved Ali Venture Capital’s plan to buy the shares from top shareholder Mango Media, which previously held a 64.2% stake. Ali Venture Capital first made its offer in mid-November.
Prior to the deal, China Mobile Capital Holdings was the second-largest holder with a 3.99% stake. Mango Media is itself wholly-owned by Hunan Broadcasting.
One of Mango Excellent’s top hits this year was the variety show “Sisters Who Make Waves,” which premiered in June and follows 30 female celebrities over 30 who compete to form a girl group, in the vein of iQIYI’s “Idol Producer” and Tencent Video’s “Produce 101.” Its first episode got 10 million views in the first 10 minutes and some 360 million views in the first two days.
The platform spends much less on content than its competitors, however, thanks to its ties to Hunan Broadcasting. It spent around $917 million (RMB6 billion) on its online video and content sectors last year, far less than Tencent Video, which burned through $7.64 billion (RMB50 billion) of content spending in the three years from 2016 to 2019, according to Chinese outlet Yicai.